Rob Grand-Lienard remembers a letter he re- ceived from a major oil and gas customer in early December 2014, promising good times
ahead. That letter helped make the president of
Special Products & Mfg. (SPM), a custom fabricator
in Rockwell, Texas, rather bullish for 2015.

“Our customer was expecting to grow their busi-ness 20 to 25 percent per quarter,” Grand-Lienardsaid. “But just 45 days later, that was all snuffed out.”Saudi Arabia hasn’t turned down the taps. We’vegot more oil and natural gas produced statesidethan ever before, and global demand isn’t sky-high.“To protect market share, none of the major pro-ducers have elected to cut back,” said Chris Kuehl,economic analyst for the Fabricators & Manufactur-ers Association International (FMA). “This may startto change, though,” he said, adding that per-barreloil prices may rise next year. “But we’re a long wayfrom another boom.”Meanwhile, bumper crops have pushed downour grocery bills along with the sales of agricultureequipment. China’s voracious appetite for raw ma-terials isn’t what it was. Construction has slid glob-ally; and in the states, the OEMs built up a bit toomuch inventory, so their supplies overshot demand.

At the same time, cheap food and fuel have put
more money in consumers’ pockets. Although consumption isn’t in high gear, it’s not pulling every-

DIVERSIFICATION PROVES ITS WORTH IN 2016

Many predict continued, steady growth—but not everywhere

Figure 1

In FMA’s “Forming & Fabricating Job Shop Consumption Report” for the third quarter of 2015, about as many said
new-order activity was expanding as was decreasing.